The Federal Communications Commission (FCC) gave a huge victory to Net Neutrality advocates by voting in favor of sweeping new rules that change the way internet services are regulated. The rules would allow the FCC to regulate ISPs in a similar manner to telecommunication companies, including by restricting their ability to prioritize or give favorable treatment to certain categories of content. Opponents of Net Neutrality, however, have vowed to block the FCC action in either the courts or in Congress.
The Feb. 26 vote is the FCC’s most aggressive move in the long-running debate over Net Neutrality. Also known as the Open Internet initiative, Net Neutrality provides that all traffic over the internet should be treated the same, regardless of content type or content provider. Advocates in favor of Net Neutrality argue that it represents the best model to ensure that all internet traffic is treated fairly, and that internet users won’t be required to pay higher fees or suffer slower download times to access their favorite content. They also point out that this has been the way the internet has been managed for more than 20 years and cite the robust growth of the internet during that time as evidence of its success.
Net Neutrality opponents argue that the growth of bandwidth-intensive content such as streaming video, videoconferencing, and large-file downloading has changed the way the internet is used. The model of the last 20 years is being strained, and as a consequence, speed and quality are suffering. Having the ability to prioritize certain content, including charging higher fees to address higher speed or bandwidth needs, provides consumers with flexible options for choosing content and promotes further development of internet infrastructure and services.
Specifically, the FCC’s vote reclassified broadband internet service as a Title II telecommunications service under the 1996 Telecommunications Act. The act distinguishes different types of telecommunications service and information providers. Telecommunications services, also known as “common carriers,” are services that simply carry information from point A to point B, such as telephone companies. These would include telecommunications infrastructure providers—such as internet backbone providers—over wired and wireless networks.
Until this proposed change, however, they did not include so-called last mile internet providers. These are ISPs such as Comcast, Verizon, and AT&T, which provide the final connection between the internet backbone and the end-of-the-line consumer, often with additional content or services. Currently, they are classified as “enhanced service providers,” companies that use “computer processing applications” to share information. The FCC has broad authority to regulate common carriers as they have done with telephone companies since the 1930s, but very limited authority to regulate service providers.
The FCC has made several prior attempts to regulate ISPs. Twice between 2000 and 2010, the FCC crafted rules for internet operations that would have imposed Net Neutrality requirements, including restrictions on blocking or throttling (slowing down) lawful content, and banning discrimination in the transmission of lawful content. Those efforts, however, were blocked by lawsuits filed by broadband providers. Most recently, in January 2014, a federal court held that the FCC did not have authority to regulate service providers under the Telecommunications Act, and so it could not impose Net Neutrality requirements.
However, the designation of broadband companies as enhanced service providers was a separate and earlier policy decision made by the FCC at a time when internet access was expanding from modems to DSL lines and broadband providers. Because broadband providers offered both telecommunications and enhanced services, the FCC policy decision was seen as a “reasonable interpretation” of the Telecommunications Act’s “ambiguous provisions.” Throughout the Net Neutrality proposals and setbacks, many courts and commentators suggested that the FCC had the ability to reclassify broadband providers as common carriers, which would give the FCC broader and clearer authority to regulate them.
The FCC’s February vote did just that. In its public statement, the commission observes that the “nature of broadband Internet access service has not only changed since that initial classification decision [of broadband as an enhanced service], but that broadband providers have even more incentives to interfere with Internet openness today.” In a separate statement, FCC chairman Tom Wheeler asserts that the goals of the commission’s order are to “ensure incentives for private investment in broadband infrastructure so the U.S. has world-leading networks and ensure that those networks are fast, fair, and open for all Americans.”
The FCC’s Rules
The FCC’s order applies to both fixed and mobile broadband providers and contains several specific provisions. The first three rules are the key to the Open Internet/Net Neutrality process. These rules prevent blocking of access to legal content, applications, and services; prevent throttling of services by impairing or degrading lawful internet content; and ban the prioritization of some internet traffic over other lawful traffic “in exchange for consideration of any kind,” including prioritizing the content and services of their affiliates. In addition, the FCC asserts that ISPs can’t “‘unreasonably interfere with or unreasonably disadvantage’ the ability of customers to select, access, and use lawful content. …” Finally, the rules require ISP transparency in presenting fees, promotional rates, surcharges, and data caps in a “consistent format.” The rules do not prevent ISPs from engaging in reasonable network management practices to manage their networks, as long as they are “tailored to achieving a legitimate network management—and not business—purpose.”
The broader debate over Net Neutrality may continue despite the FCC’s action. In bureaucratic terms, the rules have only just been proposed, and they will soon be published in the Federal Register and be subject to an extensive comment period. Consequently, they will not take effect for several months. Even the FCC’s vote on the rules shows the depth of the debate. While officially a nonpartisan and independent commission, the FCC’s vote was split on the party membership of the commissioners, with the three Democratic commissioners voting in favor and the two Republican commissioners opposing. Commissioner Ajit Pai issued a statement in opposition, describing the proposed rules as a “radical departure from the bipartisan, market-oriented policies that have served us well for the last two decades.”
Reactions to the Vote
Net Neutrality has long been opposed by broadband providers that argue that internet service is best supported by a lack of regulation and the forces of the market. Verizon has been a leading objector to internet regulation, contending in a press release that the FCC is imposing 1930s-era rules on the internet. Verizon punched up its point by issuing the release in Morse code, which was “translated” into an old-style typewriter font and dated “February 26, 1934.” (1934 was the date of the first Telecommunications Act, which covered the growing telephone industry.) Comcast took a more moderate tone in its statement by embracing the open internet in principal but objecting to the reclassification of its broadband service as a common carrier.
The reaction of Congress, which has been split on Net Neutrality, is still in flux as well. A group of 21 Republican members of the House Committee on the Judiciary issued a letter stating that the FCC rules “threaten the future viability of the Internet. …” Rep. Marsha Blackburn (R-Tenn.) called the shift to common carrier regulation of broadband a “regulatory nuclear option.” On the other hand, The New York Times reported that a legislative response was “unlikely to pass” in Congress.
While it’s likely that there will be a court challenge to these rules, and as noted, they will not go into effect until they’ve been published and commented on, the FCC’s decision goes a long way toward resolving the debate and continuing controversy. The question that may arise in the future, however, is that with its newfound regulatory authority over broadband and the internet, what might be the FCC’s next steps?